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The (long) run out of unemployment: are temporary jobs the shortest way?

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  • Fabio Berton

Abstract

A higher job creation is a common result by many theoretical approaches trying to model marginal labor market reforms. In the framework proposed by Berton and Garibaldi [2006], in particular, the equilibrium arrival rate of temporary job offers is expected to be higher than the arrival rate of permanent ones. In this paper I use a sample of prime aged male workers from WHIP in a competing risks framework in order to compare the duration of unemployment spells terminated by jobs that only di¤er in their formal duration. I fnd that the arrival rate of fixed term jobs is actually larger than the arrival rate of permanent ones; this result is robust to the main sources of unobserved heterogeneity. However, the average duration of unemployment in Italy is still very high and the liberalization of flexible contracts as a policy to reduce it did not completely solve the problem.

Suggested Citation

  • Fabio Berton, 2008. "The (long) run out of unemployment: are temporary jobs the shortest way?," LABORatorio R. Revelli Working Papers Series 76, LABORatorio R. Revelli, Centre for Employment Studies.
  • Handle: RePEc:cca:wplabo:76
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    References listed on IDEAS

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    1. Bertola, Giuseppe, 1990. "Job security, employment and wages," European Economic Review, Elsevier, vol. 34(4), pages 851-879, June.
    2. Cahuc, Pierre & Postel-Vinay, Fabien, 2002. "Temporary jobs, employment protection and labor market performance," Labour Economics, Elsevier, vol. 9(1), pages 63-91, February.
    3. Matteo PICCHIO, 2006. "Temporary Jobs and State Dependence in Italy," Working Papers 272, Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali.
    4. Leonello Tronti & Francesca Ceccato & Eleonora Cimino, 2004. "Measuring Atypical Jobs: Levels and Changes," OECD Statistics Working Papers 2004/1, OECD Publishing.
    5. Fabio Berton & Francesco Devicienti & Lia Pacelli, 2007. "Temporary jobs: Port of entry, Trap, or just Unobserved Heterogeneity?," LABORatorio R. Revelli Working Papers Series 68, LABORatorio R. Revelli, Centre for Employment Studies.
    6. Peter Haan & Arne Uhlendorff, 2006. "Estimation of multinomial logit models with unobserved heterogeneity using maximum simulated likelihood," Stata Journal, StataCorp LP, vol. 6(2), pages 229-245, June.
    7. van Ours, Jan C. & Vodopivec, Milan, 2006. "Duration of unemployment benefits and quality of post-unemployment jobs : evidence from a natural experiment," Policy Research Working Paper Series 4031, The World Bank.
    8. Olympia Bover & Ramón Gómez, 2004. "Another look at unemployment duration: exit to a permanent vs. a temporary job," Investigaciones Economicas, Fundación SEPI, vol. 28(2), pages 285-314, May.
    9. Juan J Dolado & Carlos Garcia--Serrano & Juan F. Jimeno, 2002. "Drawing Lessons From The Boom Of Temporary Jobs In Spain," Economic Journal, Royal Economic Society, vol. 112(721), pages 270-295, June.
    10. Olivier Blanchard & Augustin Landier, 2001. "The Perverse Effects of Partial Labor Market Reform: Fixed Duration Contracts in France," NBER Working Papers 8219, National Bureau of Economic Research, Inc.
    11. Fabio Berton & Pietro Garibaldi, 2012. "Workers and Firms Sorting into Temporary Jobs," Economic Journal, Royal Economic Society, vol. 122(562), pages 125-154, August.
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    Cited by:

    1. Lia Pacelli & Silvia Pasqua & Claudia Villosio, 2007. "What Does the Stork Bring to Women’s Working Career?," LABORatorio R. Revelli Working Papers Series 58, LABORatorio R. Revelli, Centre for Employment Studies.
    2. Bosio, Giulio, 2008. "Labour market transition in Italy: an empirical investigation," MPRA Paper 18901, University Library of Munich, Germany.
    3. Bosio, Giulio, 2009. "Temporary employment and wage gap with permanent jobs: evidence from quantile regression," MPRA Paper 16055, University Library of Munich, Germany.
    4. Tealdi, Cristina, 2011. "Typical and atypical employment contracts: the case of Italy," MPRA Paper 39456, University Library of Munich, Germany.
    5. Edoardo Di Porto & Leandro Elia & Cristina Tealdi, 2013. "The "emersion" effect: an ex post and ex ante social program evaluation on labor tax evasion in Italy," Working Papers 2/2013, IMT Institute for Advanced Studies Lucca, revised Jun 2013.
    6. Tealdi, Cristina, 2011. "How do employment contract reforms affect welfare? Theory and evidence," MPRA Paper 33573, University Library of Munich, Germany.
    7. Fabio Berton & Francesco Devicienti & Lia Pacelli, 2007. "Temporary jobs: Port of entry, Trap, or just Unobserved Heterogeneity?," LABORatorio R. Revelli Working Papers Series 68, LABORatorio R. Revelli, Centre for Employment Studies.

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    Keywords

    temporary jobs; unemployment duration; competing risks.;

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